A Note on the Effect of Union Army Pensions on the Labor Force Participation of Older Males in Early-Twentieth-Century America

Abstract

The labor force participation of older males in the United States started to decline in the late nineteenth century, long before the development of major public welfare programs for the elderly. Some scholars have attributed this phenomenon to the expansion of the Union army pension programs. This note suggests that the veterans' pension is of secondary importance in explaining the trend toward declining labor market activity of older males. This result implies that the labor force participation of older males would have declined over the last century even without the rise of public welfare and social insurance programs.